Purchase for Progress Honduras – Case Study Farmers’ Organization Case Study: APAO, Asociaciòn de Productores

Agropecuarios de Oriente (APAO) Arauli Linaca, Danlí, El Paraiso

Case Summary Information Name of FO

Asociación de Productores Agropecuarios del Norte del Oriente (APAO)

Name of Member Interviewed Pablo Ordoñez, President Location

Arauli Linaca, Danli, El Paraiso

Number of Registered Members

150 registered members

Male/Female Members

61 women, 89 men

Female Leadership

2 of 9 members on the board of directors are women

Legal Status

Legally formed May 5, 2003

Years with P4P Since 2009 Partners DICTA, SAG, IICA, Red SICTA, VECOMA Crops Cultivated

Maize, beans

Markets

Intermediaries, WFP (maize, beans)

Facilities

One warehouse, one office

Equipment No equipment Post Harvest Process

FO, farmers rent equipment

Credit

Currently in the process of building revolving fund for credit

Background Information on the APAO Farmers’ Organization The Asociaciòn de Productores Agropecuarios de Oriente (APAO), began as a local farming committee in 2002, according to president Pablo Ordoñez. It quickly grew in popularity, as people in the community realized the benefits of belonging to an association and began to

solicit more assistance. While the majority of the farmers cultivate basic grains, some also grow oriental vegetables. On May 5, 2003, APAO became a legally recognized non-profit farmers’ organization. APAO receives support from various organizations, including Red SICTA, IICA/Swiss Agency for Development and Cooperation (SDC), DICTA1 and VECO Mesoamerica. APAO is currently operating out of a small rented office in the Ministry of Agriculture’s (SAG) regional

offices. They plan to move soon to a new warehouse and office facility built with funding from the Red SICTA project and SDC.

In the seven years since its founding, the organization has maintained its popularity, and continues to provide agricultural assistance to any community member requesting help, regardless of membership status. According to Pablo, there is a community development

1 IICA(Instituto Interamericano de Cooperación para la Agricultura)/Swiss Agency for Development and Cooperation, DICTA (Dirección de Ciencia y Tecnología Agrícola de Honduras)

APAO´s new warehouse, constructed with donations from Red SICTA and SDC.

aspect to the organization. They have relationships with all the nearby schools, and members often teach students about the benefits of reforestation, forest fire prevention, and water conservation. “We teach the kids not to cut down the trees, because then they would be without water. We have even had some success controlling the hunting of animals and deforestation. This is a constant fight that is not easy,” said Pablo. There are currently 150 registered members who are part of P4P. Of those, 61 are women. Of the nine members of the board of directors, only two are women. Pablo says the organization has tried to encourage women to participate on the board of directors, and to join the organization but it is difficult. Some have resigned because they don’t have the time to devote to the organization in addition to caring for their families and working in the fields. One of the main concerns the women have is the amount of time they are required to dedicate to training, especially since some workshops are several days long. Pablo said that APAO continues to give women opportunities to participate. “There are cultural problems in our area; the women are not accustomed to working in the fields. Many of them have worked in the tobacco factories around here. They say that there is no time for all the training, but we are always trying to work on finding a way so that they can participate,” said Pablo. According to Pablo, 50 maize farmers are expected to provide 3,000 quintals2 of maize to P4P in 2010, and 100 bean farmers are expected to contribute 2,500 quintals of beans. Benefits APAO Brings to Smallholder Farmers As a registered organization, APAO has access to various services benefitting smallholder farmers, said Pablo. During the dry season, APAO provides potable water services for members who run out of water. They also have water available for irrigation systems for purchase by the farmers. Anyone can participate in the trainings APAO organizes, the only requirement is that they are farmers. Since APAO began participating in P4P, the numbers of the FO increased substantially, from 40 members to 150. The farmers that previously weren’t receiving any benefits or support are now getting help, said Pablo. “These farmers are now learning better production techniques. For example, before the farmers were using traditional methods, doing the same thing they had been doing for years and years. Now they are learning new and different techniques such as using insecticides and fungicides, and best agricultural practices,” said Pablo. APAO hopes to create a farmer’s market on the weekends to provide farmers with an additional market for their crops. APAO also is working with other organizations to purchase a grain dryer and improved irrigation system for farmers. Post-Harvest Processing APAO does not currently own any processing equipment, although Pablo said they are trying to negotiate funding through P4P. Last year, said Pablo, APAO rented the equipment for the farmers. The farmers were responsible for delivering the shelled grains to the warehouse, from there, APAO finished the rest of the processing. Part of the costs for post-harvest processing were covered by the FO, the rests of the costs were deducted from the grain sale prices. Pablo said workers hired by APAO sort and classify the grains. If the grains don’t meet the strict standards of quality required by WFP, than APAO cannot accept them. Grains that are too wet, too mixed (different varieties) are refused, for example. According to Pablo, that

2 1 quintal is equal to 100 lbs.

usually only happens with the farmer newest to the FO, once one has been participating in the trainings, they quickly learn the processes and standards of quality. To prevent crop losses and maintain quality standards, APAO provides some training and guidance, especially to new members. Although the FO owns some post-harvest equipment including a grain sorter and a bean polisher, the equipment is not sufficient for the demands of the members and the amount of grain that is processed during post-harvest processing. Pablo said that the equipment most beneficial to the FO would be a grain dryer. “We need to dry the maize or else it goes bad, and then we all end up losing money,” said Pablo. We already have accomplished the construction of the warehouse, and we would really like to use the building to process the grains to be sold to WFP. Marketing through FO APAO is much more well-connected to markets than other FOs. In addition to WFP, APAO has previously sold basic grains to DICTA as well as the private companies La Copaneca and El Buen Sabor. However, Pablo said the organization could still benefit from additional training in the marketing of the basic grains. All farmers deliver one manzana or 60 quintals

of grains to WFP. Credit through APAO Credit is offered through APAO which currently has a total revolving fund of 605,671 lempiras. Pablo said that the organization would benefit from additional training on how best to manage the fund and how to grow it. APAO charges a yearly fee of 150 lempiras to cover general operating expenses. WFP Contract Experience and Challenges Pablo said that thus far, APAO has not had any problems selling grains to P4P. Although member

farmers have complained about the length of time between the planting and the receipt of payment, Pablo thinks the benefits of P4P membership are well worth the wait. According to Pablo, the main challenges the organization faces is the lack of post-harvest processing equipment. He believes that the quality of the grains would increase if they were able to process the grains in the new warehouse, and this would also ease the burden on the farmers who are responsible for some of the post harvest costs.

FO Goals Pablo hopes to continue to grow the organization, develop more relationships, and expand the access to markets.

Key Lessons Learned • Lack of post-harvest equipment is a chief complaint among farmers and FO. The

purchase of this equipment would help improve grain quality and prices, and possibly expand market opportunities.

Site of future farmer's market, next to APAO´s new warehouse building.

• Both the FO and P4P would benefit from improved communication between the FO and farmers, especially regarding access to markets other than P4P. While the farmers interviewed said that there is no market other than intermediaries, Pablo stated otherwise.

• Many farmers in the area are wary of new projects after an extension worker from

a previous, non-related project stole money from them, in order to increase membership, APAO and P4P could work to increase publicity.

• Increased capacity building on the benefits of increasing the quality of the grains

to improve access to different markets would help convince farmers of benefits of selling through FO as opposed to farm gate.

• Since the ability to purchase inputs for next year’s planting cycle from the FO is

contingent upon good crop sales, is there another plan in the case of crop loss? Has the FO considered a fund for insurance?

Key Issues/Indicators to be Tracked Over Time

Summary of key issues/indicators Description of current status Organizational Structure Central office located in Arauli Linaca, Danli, El Paraiso Leadership Central board of directors Male/Female Members 61 women, 89 men Female Leadership 2 of 9 members of board of directors Training/Capacity Building Have received training on application and use of

agricultural inputs through DICTA Partners DICTA, SAG, IICA, Red SICTA Commodities Traded Maize, beans Equipment None Markets WFP, DICTA, private companies, intermediaries Transporting commodities to market Grains sold to WFP, DICTA are sold from FO, others are

sold from farm gate Credit

Building revolving credit fund using proceeds from sale of inputs from P4P

Major Challenges Lack of equipment for post-harvest processing, completing construction of warehouse/office facilities.

Major Achievements Partnership with WFP, increased membership to 150 to meet WFP demands, new warehouse facilities